U.S.-Mexico Agricultural Trade Relationship

NAFTA Has Benefited Both Countries’ Ag Sectors NAFTA trading relationship continues to provide benefits and opportunities for U.S. producers. Two-way agricultural trade between the United States and Mexico increased more than 125 percent since the NAFTA went into effect, reaching $14.2 billion in 2003 compared to $6.3 billion in 1993.

U.S. Ag Exports to Mexico Under NAFTA U.S. ag exports to Mexico have doubled under NAFTA, reaching a record $7.9 billion in Mexico is our third largest agricultural market.

U.S. Ag Exports to Mexico 2003

U.S. Ag Exports to Mexico by Sector 2003

Mexican Ag Exports to U.S. Under NAFTA Mexico’s agricultural exports to the U.S. reached a record $6.3 billion in About 50 percent of Mexico’s agricultural exports are from the fruits and vegetable sectors.

Mexican Ag Exports to U.S. 2003

Mexican Ag Exports to U.S. by Sector in 2003

Timeline Influencing CCA Discussions Late 2002 – Pressure on NAFTA due to pending tariff elimination Early 2003 – Trade relationship deteriorates as issues build to boiling point April 2003 – CCA held in Mexico City Summer/Fall 2003 – Smoother sailing as issues are resolved and trade flows Late 2003/Early 2004 – BSE and AI

Late 2002 Impending elimination of most NAFTA tariffs U.S. Farm Bill Agricultural Armor Program Mexican Congressional Actions FDA Actions on Mexican Cantaloupes

Early 2003 Blockage of U.S. Dry Beans Poultry safeguard negotiations Investigations into anti-dumping and safeguard action on beef and pork Impasse on stone fruit negotiations Apple antidumping measures Mexico’s national agricultural debate

April 2003 – CCA Held in Mexico City US ISSUES – Stone Fruit – Poultry – Dry Beans – Mexico’s meat inspection procedures – Pork – Beef – Rice – Apples – Plywood MEXICAN ISSUES – Avocados – Destination grading for grains – US Bio-terrorism legislation – Cantaloupes – Market Access – Country of Origin Labeling

Summer/Fall 2003 Trade issues begin to be resolved Examples – Dry bean shipments resume – Poultry Safeguard Agreement signed – PRA on avocados released – COOL regulations postponed – Collaboration on BTA

Areas of Collaboration US-Mexico Consultative Committee on Agriculture (CCA) – April 23 rd Meeting – August 6 th Meeting – Cancun Partnership for Prosperity Science and Technology Conference MOU with SEMARNAT Pending MOU on Food and Nutrition

Late 2003/Early 2004 BSE and North American Harmonization High Path Avian Influenza in Texas FDA Actions on green onions, cantaloupes Technical Assistance on beef and pork Dry beans and corn? US WTO cases – Beef, rice, HFCS, foreign trade law SPS at the forefront